Vitalik Buterin examines the Bitcoin block size war, including the central debate, small and big blockers’ perspectives, and digital governance implications.
The initial argument in the Bitcoin block size war focused on a simple question: “Should Bitcoin undergo a hard fork to increase the block size limit from 1 MB to a larger value?”
Advocates contended that by increasing the block size, Bitcoin would be capable of processing a more significant number of transactions, consequently reducing transaction fees.
However, this modification makes running and validating nodes more difficult and expensive, which could lead to network centralization.
The core dispute underscored Bitcoin’s identity crisis: in which direction should it lean, analogous to conventional payment processors, towards a low-cost transaction network, or should it preserve its distinctiveness as a decentralized currency independent of a central authority?
Vitalik Buterin underscored the potential for an active governance structure to compromise Bitcoin’s fundamental decentralization advantage, rendering it vulnerable to manipulation by significant entities such as exchanges, miners, or others. Such a structure is essential for implementing contentious enhancements like block size adjustments.
Vitaliks’ Overview Of Divergent Views: Small Blockers vs. Big Blockers
The fundamental point of contention between large blockers and small blockers pertained to their respective approaches to governance and technical priorities.
Small detractors prioritized decentralization and the simplicity of node operation, as they believed that Bitcoin should remain accessible to ordinary users.
They were concerned that the dominance of large entities could compromise the decentralized nature of the network.
On the other hand, proponents of big blocks placed a premium on scalability and reduced transaction fees, contending that larger blocks would safeguard Bitcoin’s affordability for users and eliminate the need for centralized layer-2 solutions.
Bier portrayed small blockers as defenders of user sovereignty against dominant miners and exchanges, while Ver portrayed large blockers as defenders of user affordability against Blockstream and other entrenched, venture capital-funded interests.
This ideological dispute transcended technical intricacies and encompassed a more expansive outlook on the future of Bitcoin.
Lessons from Bitcoin’s Civil War and Broader Implications
Reflecting on the block size war, Buterin acknowledged merits on both sides: big blockers were correct about needing larger blocks to prevent excessive transaction fees. In contrast, small blockers were more technically prudent and less prone to errors.
The conflict underscored a recurring challenge in decentralized communities: achieving consensus without fracturing.
He observed that the Bitcoin Cash separated from Bitcoin in pursuit of larger blocks, thereby illustrating the drawbacks of forking as a governance strategy.
Following the schism, Bitcoin Cash underwent additional divisions, underscoring the challenge of preserving cohesion and collaboration within decentralized movements.
With the objective of cultivating positive transformations within online communities, Buterin’s Zuzalu endeavor prioritized practical implementation over mere ideological congruence.
He suggested reading both Bier’s “The Blocksize War” and Patterson and Ver’s “Hijacking Bitcoin” to understand the significance of this watershed point in Bitcoin history and its ramifications for future digital states.